Reward Allocation Based on the Process of Changing the Relative Efficiency

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Ahmadpour Samani P.; Arman M. H.; Foukerdi A.

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Journal Paper

Paper Information

Journal: Journal of Operational Research in its Applications Year:2024 | Volume:21 | Issue:1 پیاپی (80) Page(s): 153-168

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Information Journal Paper

Title

Reward Allocation Based on the Process of Changing the Relative Efficiency

Author(s)

Ahmadpour Samani P. | Arman M. H. | Foukerdi A. | Issue Writer Certificate

Keywords

Performance Measurement

Data Envelopment Analysis

Relative Efficiency

Trend

Reward Allocation

Abstract

Fair Reward Allocation with the aim of improving the performance and efficiency of employees and organizational units has long been considered by managers and organizational theorists. This allocation is usually based on the performance of the units over a period of time. The purpose of this study is to provide a new solution for fair Reward Allocation based on improving the performance of a unit in a period compared to its previous period, because sometimes a unit may be frustrated and not try to improve performance in future periods simply by comparing organizational units and ignoring the process of improving performance compared to its past. Therefore, in this study, the Reward Allocation between organizational units is based on the amount of change in their Relative Efficiency. For this purpose, first the ratio of inputs and the ratio of outputs are calculated for each unit in two consecutive periods. Then, the performance of the units is analyzed using Data Envelopment Analysis and considering the ratio of percentage change in outputs to percentage change in inputs. Finally, according to the degree of satisfaction of the units, the
reward is assigned to the units. The approach presented in the research is explained in the form of a case study in the banking industry.

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